Hong Kong Exchanges and Clearing Limited (0388.HK) Earnings Call Transcript & Summary

Good afternoon, ladies and gentlemen. Welcome to HKEX 2025 Interim Results Analyst Presentation. Today, we are very pleased to have our Chief Executive Officer, Ms. Bonnie Y. Chan; our COO, Ms. Vanessa Lau; our Group CFO, Mr. Herbert Hui; our Group CIO, Mr. Richard Leung; and our Head of Markets, Ms. Gregory Yu. Bonnie and Herbert will first give a presentation about our business highlights, strategic progress and financial results. Then we are happy to take some of your questions. Without further ado, over to you, Bonnie.

Good afternoon, everyone. Thank you for joining us today. I'm pleased to be presenting our interim results for 2025 and in a new format in which I'm joined by key members of our senior management team who have been vital in leading the strategic delivery of initiatives across the group. In a few moments, Herbert Hui, our newly appointed Chief Financial Officer, will share more details on the numbers. After that, I will discuss some of the business highlights. And finally, the team and I will be happy to take your questions. So let's kick off with a quick overview of the results. HKEX delivered a strong first half of 2025, reporting the group's best ever half yearly revenue and profit. These results surpassed the previous record set in the second half of 2024. Headline revenue and other income increased 33% year-on-year. Profit attributable to shareholders increased 39% year-on-year. Herbert will talk through these numbers in more detail shortly. But first, I'd like to highlight some of the significant strategic progress we made in the first half of 2025 because amid the high performance of our markets, we continued to deliver a range of initiatives, initiatives that support the long-term success of our markets. Some of the highlights include the signing of an MOU with CMU OmniClear to support the development of Hong Kong's FIC ecosystem, the launch of the technology enterprises channel, further enhancing how we attract and support innovative companies, the approval of Hong Kong as a new LME warehouse location, which went live in July and the launch of 30-year swaps trading in Northbound Swap Connect. All of these contribute to making our markets more competitive, and they also reinforce Hong Kong as a leading international financial center. Just take as an example, the 3 days that the Black Rainstorm signal was issued recently here in Hong Kong. Thanks to the introduction of severe weather trading last year, our markets continued to operate smoothly with cash market turnover exceeding HKD 200 billion for each of those 3 sessions. During the first half of this year, we also continued to strengthen our partnerships and product offerings internationally and in Mainland China. We have added the Stock Exchange of Thailand to our list of recognized stock exchanges. We also saw the listing of Asia's first Saudi Sukuk ETF as well as the world's first L&I Product relating to a single Korean stock. In addition to investing in the long-term competitiveness of our markets, we also continued to invest in the success of our community. To celebrate the 25th anniversary of our listing, we committed funding of no less than HKD 25 million to a new flagship charity program focusing on support of caregivers in Hong Kong. Now driven by optimism in China's economic outlook as well as exciting developments in artificial intelligence and innovation, there was renewed global investor interest in our markets. The Hong Kong cash market went from strength to strength with volumes reaching a record half yearly high. We also saw strong performance across the Hong Kong derivatives, ETP and commodities markets. Our ETP market in the first half of 2025 reached a record half year high with average daily turnover up 163% year-on-year. We also saw record half yearly average daily volumes of 1.7 million derivatives contracts, up 11% year-on-year. Our commodities business delivered strong results in the first half of 2025. Volumes were up 3% compared with a year earlier and open interest increased by 14% year-on-year. A few moments ago, I mentioned that Hong Kong was approved as an LME warehouse delivery point, and we are very pleased to see at present 8 warehouse facilities across the city now hosting metals under LME warrants. And revenue from our data and connectivity business was up 5% year-on-year. Though market sentiment will continue to be affected by macroeconomic and geopolitical factors, we remain cautiously optimistic about the year ahead. I will discuss our core business strengths, our focus on diversification and our most important strategic initiatives in more detail shortly. But first, let me hand over to Herbert to go through the results. Over to you, Herbert.

Thank you, Bonnie. Good afternoon, everyone, and thank you for joining our results presentation today. My name is Herbert Hui, Group Chief Financial Officer. I'm pleased to be here to share with you our 2025 interim results. HKEX delivered strong first half results with both revenue and profit after tax reaching record half yearly highs, surpassing the previous record set in second half last year. With increased participation from international and Mainland China investors seeking diversification, trading volumes of cash market, derivatives market and Stock Connect in Hong Kong all reached record highs. Revenue and other income of HKD 14.1 billion was 33% higher than first half last year. Profit after tax was KHD 8.5 billion and earnings per share was HKD 6.74, both up 39% compared with first half last year. The Board has declared a first interim dividend of HKD 6 per share, an increase of 38% as compared to first half 2024 and representing 90% of the group's profit, excluding results of Hong Kong -- of HKEX Foundation. Comparing Q2 results with the previous quarter, strong momentum in cash market continued following the record Q1 with headline ADT reaching the second highest quarterly level of HKD 238 billion. Although Q2 Headline ADT was lower than that in Q1, both Q2 revenue and profit still reached record quarterly highs as seasonal increase in depository fees and higher-margin fund net investment income more than offset the slightly lower volumes. Comparing Q2 results with Q2 last year, revenue was up 33%, while profit up 41%. Turning to the detailed financials of the first half of this year. Headline ADT of HKD 240 billion was more than double that of the same period last year, reaching a record half yearly high. Both Northbound and Southbound Stock Connect also saw record highs. Derivatives market recorded solid growth with a record number of derivative contracts traded in the first half this year. Revenue and other income of HKD 14.1 billion was 33% higher than first half last year. This was driven by higher trading and clearing fees, higher depository fees and increase in margin net investment income. OpEx was up 6%, mainly due to the nonrecurring U.K. FCA fine of HKD 19 million paid this year and the recovery of LME nickel legal fee of HKD 50 million received in the first half last year. The group's effective tax rate increased to 15.8% in first half 2025 as compared to 11% the year before due to the provision for top-up tax under BEPS 2.0 that came into effect from the beginning of this year. Turning to the detailed financials of Q2 this year. Revenue and profit were up 33% and 41%, respectively, compared to the same quarter last year, driven mainly by the increased trading and clearing fees resulting from higher cash market volumes, an increase in depository fees and stronger net investment income due to a larger margin fund size and an exchange gain of -- resulting from our U.S. dollar holdings. OpEx was up by 5% due to an increase in staff costs. The recovery of LME nickel legal fees in 2024, partly offset by lower charitable donations due to timing difference. Excluding the recovery of legal fees and charitable donations, OpEx increased by 7%, reflecting our continuous investment in our talent, infrastructure and operational resilience. Let's now look at the quarterly performance against the historical trend line. Driven by the positive market momentum since Q4 last year, first half 2025 performance is above the historical generally upward sloping trend line. Throughout the years, HKEX continues to maintain an attractive EBITDA margin, reflecting the successful diversification of our business in recent years and our continued cost discipline. Next, let's take a closer look at our net investment income. To fund the acquisition of HKEX headquarters, we are in the process of redeeming our external portfolio with proceeds to return to HKEX after the applicable lockup periods. As at 30th June 2025, we have already received approximately 60% or HKD 4.3 billion of the funds. For the internally managed funds, total net investment income in first half was 17% above first half last year, primarily driven by an increase in margin fund size as a result of higher margin requirements, partially offset by lower investment return. The lower investment return experienced in first half this year may continue as we renew our short-term investments under the current low Hong Kong dollar interest rate environment, particularly as compared to the pre-May interest rate level. Moving on to our operating expenses. OpEx was up 6% in first half compared with first half last year due to the U.K. FCA fine in 2025 and the recovery of LME nickel legal fees in 2024 mentioned previously. Excluding these items, OpEx was up 1% due to higher staff costs and IT costs. In summary, HKEX core business continues to demonstrate remarkable strength, resilience and vibrancy as reflected in our financial performance. With the enhancements we have made to our market microstructure and IT infrastructure over the past few years, we have been able to capture the opportunities presented by the improving market sentiment. We are confident that our continued undertaking of various strategic initiatives will further reinforce HKEX unique role as a global superconnector. With that, I will now hand back to Bonnie for our business and strategic update.

Thank you, Herbert. As we noted, the results for the first half of 2025 were strong, reflecting our continued resilience and relevance as well as the success of our diversification strategy and focused strategic development. Average daily turnover volume in the cash market saw a record half yearly high, more than double that of the first half of 2024. Strategic enhancements to our fundraising platform enabled us to capture the surge in capital raising activities, making us the #1 global IPO venue in the first half of 2025. We had 44 IPOs raising over HKD 109 billion, which was the best half year since 2021. Our IPO pipeline is robust with around 200 companies having filed to list. Our fundraising success has not been limited to IPOs. Follow-on funds raised, including equity-linked transactions totaled over HKD 240 billion, which is the highest half yearly record since 2021. Our diversification strategy continues to deliver. We have achieved record-breaking volumes in our derivatives segment. Additionally, we have seen robust performance in both commodities and ETP markets. The Connect programs also performed well. Stock Connect trading volumes recorded strong growth in the first half of 2025, reaching record half yearly highs. Northbound ADT rose 32% year-on-year to over RMB 171 billion. Mainland investor activity in offshore markets increased with Southbound ADT reaching HKD 111 billion in the first half of 2025, almost 3x the figure from a year earlier and making up nearly 23% of cash market trading volume. Average daily turnover for Northbound and Southbound ETFs was at RMB 2.6 billion and HKD 3.8 billion, respectively. Southbound volumes reached a new half yearly record, up 155% year-on-year. Bond Connect and Swap Connect also reached record highs with Bond Connect Northbound ADT up 3% and Swap Connect's average daily clearing volume increasing 72% year-on-year. Now looking more closely at derivatives and commodities. As I mentioned earlier, there was a record number of derivatives contracts traded. LME volumes also showed healthy growth, up 3% year-on-year. Our fixed income and currency business is also on a positive trajectory. USD/CNH futures contracts maintained their growth in the first half of 2025 with ADV reaching over 113,800 contracts, up 44% compared with the first half of 2024. In particular, the ADV of the contract hit a record monthly high of over 129,800 contracts in February 2025. In March, HKEX signed an MOU with CMU OmniClear, the central money markets unit of the HKMA to support the long-term growth of Hong Kong's fixed income and currency markets. The development of our FIC business is a long-term commitment. But our collaboration is an important milestone that brings HKEX a step closer to providing a complete ecosystem for bonds to do for the fixed income market, what we have achieved for the equities markets. Through this MOU, we look forward to further enhancing Hong Kong's status as an international financial center, a global risk management center and an offshore RMB hub. The MOU with CMU OmniClear is just one example of the strategic advancements we made to our business and markets in the first half of the year. Building on our China strength, we began accepting China government bonds as collateral for Swap Connect and derivatives in OTC Clear. In exploring adjacent businesses, we launched the order routing service on the integrated fund platform. We continue to make headway in supporting the long-term liquidity and vibrancy of our marketplace. To this end, Phase 1 of the minimum spreads reduction was recently implemented, aiming to boost liquidity and lower overall transaction cost. We also concluded the consultation to IPO price discovery and open market requirements with the enhancements taking effect recently, boosting the attractiveness and competitiveness of the listing mechanism for existing and prospective issuers. Finally, we continue to future-proof our business and operations. A key example is our recent publication of the discussion paper on a shorter settlement cycle for Hong Kong's cash market. Another is our strategic investment in our permanent headquarters at Exchange Square. This underscores our long-term commitment to the growth and future development of Hong Kong as a leading global financial center and to further enhance our community engagement programs. To conclude, HKEX produced strong results in the first half of 2025, reflecting a significant turnaround in Hong Kong's markets. Going forward, we recognize that the global macroeconomic environment is going through profound change. Investors and issuer demand for diversity of products, deep liquidity and powerful connectivity will intensify. It is essential that we lean full tilt into meeting these demands. We need to build for the future, and our focus remains firmly on embracing innovation and strengthening the foundations of our marketplace. We are prioritizing initiatives that foster greater connectivity, operational resilience and responsiveness to global clients from institutional to retail. We are actively engaging with stakeholders to identify new opportunities, cultivate a culture of agility and ensure that our infrastructure keeps pace with an evolving financial landscape. By continually reviewing and refining our strategies and by investing in forward-thinking solutions, we position HKEX to not only maintain its leadership, but also to anticipate and meet the challenges of tomorrow's global markets. The past 6 months reinforces our confidence that HKEX is on the right path. And we continue to work closely with our partners and stakeholders to continuously enhance our market infrastructure, expand our products and partnerships and future-proof our business. I'd like to especially thank my senior management colleagues as well as everyone at team HKEX for their ongoing support. We are now happy to take your questions. Thank you.

Thank you, Bonnie, for your sharing and Herbert as well. We will now open the floor to take some questions. Operator, can you please give the audience the instructions again how to raise questions either via webcast or audio?

[Operator Instructions] And the questions come from the line of Gary Lam from HSBC.

Congratulations for the historical high for the results. Maybe if I'm a little bit greedy, 3 questions. Firstly, on Southbound, clearly, we see that the turnover has increased by 200% in the first half. That partly contributed to the non-Southbound ADT, if my calculation is right, also up 100%. I understand that there's various further initiatives for HKEX to widen the Southbound scheme, such as R&D counter, such as Southbound access to REIT. Can we get an update on sort of these initiatives, particularly referring also to the timing of such delivery? Second question related to IPO. ADT momentum is very strong. I attribute this partly to Asia companies seeking Hong Kong listing. U.S. company going back to Hong Kong, but also like pre-IPO companies choosing Hong Kong as the sort of like sole or first platform to get listed. But regarding the third channel, in some observation, we are sensing that onshore China Asia IPO is seemingly picking up in speed. To what extent would it result in more competition on the -- like from an issuer side? What's your assessment on the sustainability of this very strong sort of IPO application flows? And maybe thirdly, just quickly on the housekeeping perspective, noting the premises working capital that we start to record HKD 1.8 billion in this quarter. Can we get some color on the timing on further expenditures and how would the depreciation schedule will be like? Is it like earlier guided about like 30 years of depreciation, maybe starting, is it in the second half '25?

Thank you, Gary, for your questions. I will address the first 2, and then I will pass on to Herbert to address your third question. So your first question is on, well, understanding better the Southbound flow. And I think it is true that we are seeing very encouraging signs that Southbound flows into our market continue to be extremely strong, I mentioned earlier that it now accounts for about 23% of our cash market turnover. And obviously, the base is higher because we have more turnover. So it's a very good phenomenon. And indeed, as you suggested, we are doing a lot to capture more of the Southbound flow because we really see a lot of potential, knowing that the penetration, if you may, within the Southbound population -- or within the population of Mainland retail investors is still, I think, at a very shallow level. Also noting that, of course, in terms of middle class population in Mainland China, it's now edging towards 500 million. So there's a lot of headroom for us to capture. Now specifically, you mentioned the RMB -- the Southbound RMB counter and Reconnect. Those 2 initiatives, which have already been announced, and we have been working very closely with our Mainland partners to date to really sort of tie up the loose end. It is still our plan to roll this out before the end of the year. And so as soon as we are in a position to share more details, we'll certainly do so. Your second question is on IPOs. Yes, we are very encouraged by the fact that as a result of our continuous improvements and enhancements to our listing framework, we're now seeing the framework being a lot more inclusive. So aside from Mainland Chinese companies, which has traditionally been the main source of our IPOs, we are now seeing also some companies in other regions, in particular, Asia listing on our exchange. So to date -- year-to-date, we've seen companies from Thailand, from Singapore and in the pipeline, we have a few more. Now specifically, you asked me how I look at the competition with the domestic exchanges in the Mainland, noting that the Asia IPO queue has reopened? Personally, I don't look at it as competition. I actually see HKEX and the 3 domestic exchanges, Beijing, Shenzhen, Shanghai, being very complementary because China is obviously a big market, and it's growing, continues to turn out a very, very robust pipeline. At the moment, our pipeline is at around 230, meaning that 230 companies have already filed. And given the very strong activity level in the IPO space, between me and my team, we're seeing many companies on a daily basis. So I do think that the pie is very big. For us, the sweet spot is obviously the fact that we have the connectivity to the rest of the world, and therefore, I think we are particularly attractive to companies in the Mainland, which has overseas expansion plans. And in fact, you would have noticed that a meaningful portion of our pipeline consists of companies which are already listed in the Asia market now wanting to do an additional listing on the H share market. And the reason why they want that additional listing status is really so that they can have access to offshore fundraising channels. And so I really do not worry about the so-called competition, but rather I see this as a good way that we increase the sophistication of the China's capital markets in conjunction with the 3 domestic exchanges. With that, I pass over to Herbert to answer your third question.

Okay. Thank you, Bonnie. With respect to the purchase of this trophy assets as our headquarter, so the listed price is HKD 6.3 billion. We probably add a bit of stamp duty, about HKD 300 million, and that will take it to about HKD 6.6 billion. As we speak, we have paid about HKD 2.6 billion with about HKD 4 billion that's still outstanding. And we expect to be -- that will be paid in accordance with the delivery of the floors. So far, we have taken possession of 3 floors. The remaining 6 will hopefully happen within the next 12 to 18 months. And the funding for the purchase is coming from the external portfolio. So we have redeemed the external portfolio, as we all know. And as we speak, actually at the end of June, we have received HKD 4.3 billion, representing about 60% of the external portfolio. The rest will come over time because some of the funds have this gating requirements. Accounting impact, in a nutshell, I see no -- it will not be -- it will be immaterial impact to us. Obviously, at different times, there will be different accounting entries taking place. So when you buy assets, obviously, as an asset owner, you will be experiencing depreciation. And as I just mentioned, the funding for the purchase will also mean that it has reduced our corporate fund size, and that will also have some impact on our net investment income. But on the other hand, we'll be saving on our rentals. So net-net, the impact will be immaterial.

The next questions come from the line of [indiscernible] from UBS.

This is Charles Zhou from UBS. So first of all, congratulations to you on a very strong set of results. I got 2 questions. First, I think you achieved very effective cost control in the first half. So if we strip out the one-off expense, so how did you achieve this? And also, what should we expect about the -- I mean, the trend for the OpEx in the second half? And the second question is about related to HIBOR. So we see lower HIBOR since May and also see the recent rebound. So how do you view the NII, the net investment -- I mean, the NII in the next 12 months, especially in the second half?

Thank you, Charles, for your 2 questions. I think your first question talks about how we spend money. I would give a very general answer that it's really a matter of exercising discipline. I think we are very careful to manage sort of our spendings, especially noting that on the revenue side, we are, to a very big extent, subject to factors which are beyond our control, ADT could be affected quite a bit by macro conditions. And therefore, what we can -- what is more within our control, we try our best to exercise as much discipline as possible. Now that said, I guess, in my opening, I did allude to the fact that we are on the right path in terms of steadying the ship. And in fact, we see very, very strong momentum in our equities market. We believe that on the horizon, they are very, very good opportunities for us to capture, but we do need to make investments, whether it's talent, whether it's our infrastructure, whether it's delivery -- developing new products, I mentioned, obviously, wanting to double down our efforts in the FICC space. So all that obviously will involve some investment, which rest assured that we will exercise good discipline to make sure that we continue to deliver solid results. I'll pass on to Herbert to answer your second question on HIBOR and NII.

Charles, on the second question on HIBOR, so if you look at our -- the largest portfolio that we are managing is the margin fund portfolio and the average duration is around 6 months for that portfolio. So that means that we need to reinvest from time to time, given the short duration that we have. So that -- in terms of the HIBOR movements, we are looking at probably about 20 bps few days ago, a week or 10 days ago, and now it's probably 10x up in terms of overnight HIBOR. And if you were to -- even reinvesting at today's level, if you were to compare with the investments that was made like pre-May level or even back in 2024 last year, it's still lower than before. So that still present challenge. Obviously, HIBOR is volatile. It's like as we see over the past few days, it's fluctuating from time to time. But the general trend is we see starting May, there's a very steep drop in the HIBOR rates.

Next question is coming from webcast, so I'll just read it here. It's from Harsh from JPMorgan. Bonnie, 2 questions. But the first one, Bonnie already covered about the Southbound eligibility for dual counter stocks, so I'm not going to repeat. I think another question is around any potential to introduce a zero-day options. And obviously, we assume that we have done a benchmarking with some other exchanges, which obviously the zero-day gross notional a significant multiple of the cash volume, taking U.S. and India as an example. So what is needed for HKEX to get to a degree of similar outcome? I have a question for Bonnie.

Yes. I think Greg will be in the best position to answer those. So I'll pass over to Greg.

Okay. Thank you, Bonnie. Harsh, thank you very much for the question. Zero-day option obviously is getting a lot of attention, whether it's from media or from analysts like. So from our end, we are doing a sets of enhancement, particularly on the intraday margining setup that is probably the most important aspects that we need to make changes to in order to cater to these type of products. So on that, I mean, we are already working on it. So when there are a clearer delivery time line, we will definitely keep everyone posted. But as much as the trend or, I would say, media attention towards zero-day option, in reality, what is truly getting the rise in this particular trend is actually the rise of retail or protail participation in exchange-traded products, particularly on derivatives. So if you look at what we have been offering, of course, warrants, CBBC, those are already important products that we have available for retail investors. But what's also interesting to note is that on the first half of 2025, our weekly stock options have averaged about 84,000 contracts a day, which account for about 21% of our total volume of stock options just on 11 underlying stocks. What that means is there are still a lot of headroom for us to continue to grow this type of products. On top of that, such as tightening strike levels, will also enhance volume and interest from retail participation. In order to get to the level to the -- what you've mentioned, right, in terms of multiple of cash volumes, what do we need to do? Of course, I've mentioned a few things here already, but more importantly is our work -- continue to work very closely with brokers, especially online brokers to reach more global retail investors. So we certainly understand this global trend, and we will continue to enhance our product and platform to cater to this.

The next questions come from the line of Gurpreet Sahi from Goldman Sachs.

Congrats from my side also. Can I have a couple, please? First is going back to the stock options question. So I acknowledge that some sort of changes need to be done to truly get to zero-day option equivalent, zero-day to expiry option equivalent. In other words, you need a weekly option expiry every day. But what is stopping us from having more number of stocks enjoying 1 weekly expiry? So as Greg mentioned right now, 11 underlying we have and CATL added recently, we can have potentially around 200. So what's the holdup from expanding this to more number of stocks? So that's the first question. And second, with respect to improvements in the cash market side, the tick size reduction for some of the stocks, which we call it the bottom half of the universe here. What kind of an impact do we expect over time from this?

Okay. So let me continue on. The first question is with regards to why we can't offer more. I think -- let's be clear, we can. Absolutely, we can, but we also need to think about from an effectiveness and scale perspective, right? So we're offering 11 names at the current moment, which generates about, let's say, $90 million in revenue. And then we can continue to offer more. But at the same time, the interest for the new sets of, let's say, another 5 options, the effect in terms of the interest may not necessarily be as high as this particular 11. What we will continue to do is to monitor. Of course, we'll continue to expand this. But on top of that, I think we will also take a look at the various different new IPOs and the retail interest towards those. And as we have strong interest towards those, we will continue to offer more. And particularly, I also want to highlight from a resiliency standpoint, right? We want to make sure that we have the resiliency to maintain all of these particular high short-dated options. And at the same time, also want to highlight that we are offering or we are coming up with the Orion derivatives platform, which we will be able to cater more volume, longer traded hours and further resiliency towards a higher volume of products. So those are the various different considerations that we have. Sorry, bid-ask spreads. So from -- back to the question on the minimum bid-ask spreads. So I just want to perhaps give a little bit of the background, right? So on phase 1, we have done 50% on the spread reduction for stocks that are priced between HKD 10 to HKD 20, and a 60% spread reduction for stocks priced between HDD 20 to HKD 50. So in terms of impact-wise that is catering to about 300 stocks, which is about 30% of our ADT. So over the course of last 2 weeks, the impacted stocks, in fact, have about 22% of narrower spreads, which means decrease in execution cost. But on top of that, the average spread of the top 100 stocks has fallen from about 16.4 basis points to about 11 basis points. So -- and from a turnover perspective, there is an increase of 25% of turnover or a higher turnover -- sorry, backtrack, 25% higher turnover of these stocks that we have done the spread reduction, higher than that of the stocks that have not been done with the spread reduction. So that showcase the impact towards what we have done by doing the spread reduction. And -- but we just want to note, of course, this is just preliminary given that it's only 2 weeks' worth of data. And in the next steps on phase 2 in mid-2026, we'll continue to implement the second phase where we'll be aiming at a 50% spread reduction for lower-priced stocks at HKD 0.50 to HKD 10 range. So we'll continue to improve the overall market microstructure, which will bring further vibrancy to the market.

Thank you, Greg. One more question from the webcast. So I read it here from Bloomberg Intelligence. Digital asset ecosystem is developing rapidly with the introduction of the stablecoin ordinance. What is HKEX doing on this front? Whether it be investing in infrastructure or new product launches?

Let me take that question, and I'll ask our CIO, Richard, to supplement. So digital asset, in fact, I do want to point out the fact that there's a lot of discussion in the market about various different items sort of broadly within this label. Clearly, the legislation we've seen recently covers things like stablecoins in particular. And broadly speaking, we've been asked a lot of questions as to how we are looking at crypto asset, tokenization, use of blockchains, et cetera. So I do sort of, first of all, want to point it out because oftentimes, we -- the conversations may be happening with cross-border purposes. But suffice to say that, first of all, we are paying a lot of attention to the regulatory development, right? We want to make sure that we understand the landscape first before we take any bold steps. And secondly, and Richard will elaborate on that, we are also studying very carefully the technology, which underlies the development of a lot of these different trends. Now to use crypto assets as an example, I think to date, as a lot of you are aware, we have already embarked on the journey by allowing crypto-linked ETFs to be listed on our exchange so that investors who may want to take a position in crypto assets, but want to do so through the medium of securities may find it conducive to do so. For stablecoins, we are studying the potential use cases. Because as you may be aware, there's a lot of talk, a lot of the sort of early discussion. It seems to us that people are focusing more on using stablecoins as a medium of payment. For us, we believe that for any sort of development in the crypto -- sorry, in the stablecoin space to really succeed, we need to be very conscious of the use cases that can be deployed. And in our particular business, what we are focusing on is whether or not we can identify use cases beyond just payment, right? Can we potentially, for example, apply it to trading clearing settlement of assets. But why don't I pass it on to our CIO, Richard, to elaborate?

Thank you, Bonnie. Well, as Bonnie has said, well, we keep monitoring the development of this digital asset technology, whether it's stablecoin or tokenization in Hong Kong and also other jurisdictions. We welcome this development because we think that it will improve market -- capital market infrastructure operating efficiency. However, I think like any technology, it comes with a lot of benefit and also potentially some risks. So we need to study them carefully and weighting between these 2 elements before we step into using this kind of new technology. But we're working on that. We are -- we will spend time in finding the right use case, as Bonnie said, in -- and also doing the proof of concept before we're really embarking on the journey of this new technology. So Bonnie has said -- also said that finding a good use case is important with these new technologies. Rather than just blindly adopting them, we need to find the right place to use it. Clearing and settlement process is one, especially when we are talking about shortening the settlement cycle, whether this can be one of the tools that we can provide to the market or allow the market to use for that. The other one is even in existing market structure, we have night trading for our derivatives market. Can we actually use some of this technology to help to improve the risk management process after trading -- after normal trading hours or after banking hours. I think these are all the potentials. I want to emphasize again, we need to look at not only the potential benefits, but also the risk associated with it.

Thank you, Richard. Thank you, Bonnie, and thanks for everyone joining the call today. It's a pleasure to talk to you. And hopefully, we'll meet and speak again very soon. Thank you, everyone.